Question: I need help finding the operating income (loss) if the changes are made. Della Rain Gear selis monogrammed umbrellas on Etsy. Della Rain Gear is
Della Rain Gear selis monogrammed umbrellas on Etsy. Della Rain Gear is currently selling 500 umbrelas a month at a price of $28 per umbrella. The variable cost of each umbreta salf includes $12 to purchase the merchandise from suppliers and a $5 commission paid to Eisy. Fixed costs are $3,000 per month. The company is considering raising the selling price of each umbrella to $34, but believes the number of umbrellas soid would drop by 15% as a tecult of the price increase. Should Deila Rain Gear raise the seiling price of its umbrollas? Begin by preparting the contribution margin income statemtent at the current seliing price of $28 per umbrella. Next, cabculme Della Rein Gear's coperating income if the changes are made. (Use parenthites or a minus sigh for an operating lass)
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